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Nixon hints at HB 253-style campaign against legislature’s tax cut

JEFFERSON CITY, Mo. – Democratic Gov. Jay Nixon said Wednesday he was considering barnstorming the state to lay out his case against the legislature’s latest tax cut bill.

Speaking to reporters soon after the vote, Nixon said, “this year’s reckless fiscal experiment looks a lot like last year’s.”

“Clearly, the magnetite of this is significant and the importance to our future is very real,” he said. “I will continue to press on this issue and lay out in a very real way the bad effects it will have for our schools.”

The tax cut, which could reduce state revenues by $600 million annually when fully implemented, would reduce the maximum tax rate on personal income by from 6 to 5.5 percent beginning in 2017 and allow a 25 percent deduction of business income on personal tax returns. Both provisions would be contingent on state revenues being $150 million higher than the highest of the three prior years. Other provisions would require the state’s income tax brackets to be adjusted annually for inflation, resulting in lower revenue, and provide an additional $500 tax deduction on top of the state’s current $2,100 deduction for residents with incomes below $20,000.

Nixon had worked with the bill’s sponsor, Sen. Will Kraus, on a proposal earlier this year. His plan was two-fold: any tax cut would need to include a requirement to fully fund the foundation formula for K-12 education as well as place caps on the state’s most costly tax credits.

“Signing some sort of fiscal experiment of a broad nature this year like this that allows especially generous benefits for folks who don’t need anything. What lobbyist needs a tax cut? What lawyer does everybody steel so sorry for rather than funding education,” Nixon asked. “It’s important to have a discussion about them.”

Despite his broad statements against the bill, Nixon stopped short of explicitly saying he would veto it. The Missouri Constitution gives a governor 15 days after being delivered a bill to make a decision.

“We’re of a habit of reading things,” he said. “I haven’t had a chance to do that.”